A rebate program in Canada that encouraged the ownership of electric vehicles was recently frozen, and Tesla is not happy.
As explained by the Toronto Star earlier this month, Tesla accused the Canadian government of making an unlawful decision to freeze over $43 million in electric vehicle rebate payments and threatened legal action if the payments are not resumed.
The company sent a letter to Transport Canada on March 28 criticizing then-transport minister Chrystia Freeland's decision to stop rebate payments amid an investigation into the massive spike of thousands of claims filed within the final 72 hours of the program.
"Transport Canada knows full well that Tesla Canada has been fully compliant with its participation in the program," the letter stated, per the Toronto Star. "We expect payments to resume in the immediate term."
The letter, which was sent before Tesla officially unveiled its 13% year-over-year dip in Q1 sales, was signed by Tesla Canada's director of sales and service, Fereshteh Zeineddin, who further asserted that "Tesla reserves all rights to seek appropriate remedies in the event we cannot consensually resolve this dispute."
As part of the effort to incentivize the adoption of electric vehicles, the Canadian government established the iZEV rebate program, which offered buyers $2,500-$5,000 off the purchase price of qualified electric and plug-in hybrid vehicles. According to the Toronto Star, the popular program has "handed out nearly $3 billion to more than half a million EV buyers since 2019."
Unfortunately, Transport Canada informed dealerships across the country in an early January email that program funding was running low and there wasn't much time left to file their final rebates before it ran out.
This created a scramble to secure the rebates, as four Tesla locations in Toronto, Quebec City, and Vancouver filed more than 8,600 rebate claims for a whopping total of $43.1 million, equivalent to 60% of the remaining funds. This significant spike left 226 independently-owned dealerships without a way to recoup $10 million in rebates that had been fronted to customers.
Following the spike, Freeland immediately pushed for an investigation into the legitimacy of the claims.
"As soon as I became Transport Minister, I asked the department to stop all payments for Tesla vehicles in order to fully examine each claim individually and determine whether all are eligible and valid. No payments will be made until we are confident that the claims are valid," Freeland said in a statement to the Toronto Star.
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Definitely 👍 While it is necessary to ensure that all rebate claims are compliant with government regulations, the decision to freeze payments can potentially slow the adoption of electric vehicles, which is a key step in the fight against a warming climate and creating a healthier future.
When driven, Teslas and other EVs don't produce carbon pollution that contributes to rising temperatures and the subsequent uptick in supercharged extreme weather. This means they also result in less air pollution over their lifetimes, creating safer air quality for all. What's more, these vehicles can help save money on fuel compared to gas-guzzling cars.
Installing solar panels can boost the cost savings associated with EV ownership even further, as solar energy is cheaper than using public charging stations or relying on the grid. Consider exploring EnergySage, which provides a free service to compare quotes and can save up to $10,000 on solar installations.
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